LOL!

"19. Can an authorised officer self-authorise his or her own use of powers?

In legislation yes but in practice the decision has been made not to allow this for the immediate future."

Source HMRC

How long is the "immediate future"?

Tax does have to be taxing.

HMRC Is Shite (www.hmrcisshite.com), also available via the domain www.hmrconline.com, is brought to you by www.kenfrost.com "The Living Brand"

Powers of Entry

The Telegraph notes that, as from 1 April, new HMRC powers mean that income and corporation tax inspectors will have the same powers of entry as those used by Customs officials investigating unpaid VAT.

Sue Holmes, head of national tax investigations at Smith & Williamson, is quoted:

"The many thousands of business people and sole traders who claim expenses for 'use of home as an office' should recognise that from next month, HMRC has the right to enter their home without prior warning to inspect business records.

Inspections can be approved by a senior official in a local tax office, Ms Holmes added."

HMRC downplay the likelihood of the abuse of the powers:

"HMRC does sometimes need to access premises connected with businesses to see such things as goods and assets where it is reasonable to do so, to ensure the right tax is being paid. Although HMRC is extending these powers, it is also extending safeguards.

In particular, unannounced visits can only be made with the approval of specially authorised officers."

That would be all well and good, if the authorising officers were outwith HMRC. However, they are part of HMRC therefore an independent check/balance does not exist.

The question is will the temptation to abuse these powers be too much for HMRC?

Tax does have to be taxing.

HMRC Is Shite (www.hmrcisshite.com), also available via the domain www.hmrconline.com, is brought to you by www.kenfrost.com "The Living Brand"

Myners - The Irony

I am amused to see that Lord Myners, in an earlier life, had no qualms about helping to set up Aspen Insurance Holdings in Bermuda. Aspen being an offshore company (of which he became part time chairman) that, owing to its structure, avoided over £100M a year in tax.

His five year term as chairman of both the UK and Bermuda arms of Aspen ended in May 2007, he then became a minister in October 2008.

As we all know, tax avoidance is perfectly legal.

Isn't it therefore ironic that Myners is now the minister charged with clamping down on tax avoidance and tax havens?

Tax does have to be taxing.

HMRC Is Shite (www.hmrcisshite.com), also available via the domain www.hmrconline.com, is brought to you by www.kenfrost.com "The Living Brand"

A Lesson In Failure

Gordon Brown's much derided Tax Credit system, mismanaged by HMRC, is still the subject of scorn and dismay.

The Public Accounts Committee has stated that overpayments (which were £7.3BN between 2003 and 2007) are still running at a staggering £1BN per annum. Needless to say the hapless recipients of the overpayments are then asked to repay them.

Edward Leigh MP, Chairman of the Public Accounts Committee told the BBC:

"It is distressing that many of the families that have to make repayments to the department, on average £770 for a single year, are highly vulnerable and struggling in the economic downturn."

Adding:

"The department has not given claimants the support they need in making claims and reporting changes in circumstances, and it has assumed too much on the part of claimants in their understanding the tax credits system."

The Committee also noted that the PAYE income tax system had a backlog of 16M cases, as at March 2008, which need manual checks to ensure they are accurate.

Tax does have to be taxing.

HMRC Is Shite (www.hmrcisshite.com), also available via the domain www.hmrconline.com, is brought to you by www.kenfrost.com "The Living Brand"

HMRC Service Levels

Albeit a little late in the day, the ICAEW are conducting a survey into HMRC service levels for submission to the Treasury Select Committee.

Tax does have to be taxing.

HMRC Is Shite (www.hmrcisshite.com), also available via the domain www.hmrconline.com, is brought to you by www.kenfrost.com "The Living Brand"

Data Security

Jill Brown, a widow of three years, claims that she is still receiving mail from HMRC for her deceased husband (who used to be a tax consultant).

There appears to be a glitch in the HMRC computer system, which means that each month people's personal tax details are sent to Mrs Brown's address in the name of her late husband.

Mrs Brown claims that she has repeatedly told HMRC about this problem, and returned letters to HMRC's office in Merrywalks Stroud, but the letters keep coming.

I believe there is a specific form that the Post Office can supply, that can stop mail to the deceased. This may be a speedier and more effective solution than waiting for HMRC to sort this mess out.

Tax does have to be taxing.

HMRC Is Shite (www.hmrcisshite.com), also available via the domain www.hmrconline.com, is brought to you by www.kenfrost.com "The Living Brand"

Avoidance vs Evasion

I just know that one of my regular visitors will feel compelled to comment on this, as he always does when I use the "A" word:)

"Tax avoidance is legal, whereas tax evasion is illegal".

I am pleased to see The Times agrees with what I have been saying for so many months.

Tax does have to be taxing.

HMRC Is Shite (www.hmrcisshite.com), also available via the domain www.hmrconline.com, is brought to you by www.kenfrost.com "The Living Brand"

There's Irony For You

It is reported that TNT have been awarded a £4.5M mail contract by HMRC, the largest one awarded in government for mail and parcels in fact.

Aside from the fact that this is taking work away from the Royal Mail, which in theory is to remain state controlled, the real irony is that TNT was subject to an HMRC investigation that caused it to pay back millions of pounds (estimated by some at around £48M) of unpaid tax after its staff illegally falsified and backdated documents.

Oh, I should also mention that TNT were blamed by HMRC for losing those discs in 2007.

Tax does have to be taxing.

HMRC Is Shite (www.hmrcisshite.com), also available via the domain www.hmrconline.com, is brought to you by www.kenfrost.com "The Living Brand"

Size Matters

From the BBC:

"In these straitened times, governments everywhere are doing their best to downplay the effects of the recession.

But not HM Revenue and Customs.

Employers are being asked to double the size of P45 forms, given to staff leaving their service. The old A5-sized forms are being replaced with an A4 version.

An HMRC directive reads:

'It is... important to remember that employees may not recognise the new forms. All they need is reassurance that the form P45 has changed in appearance and now includes their date of birth and gender.'

Yes, that's all the reassurance anyone could ever need."

Tax does have to be taxing.

HMRC Is Shite (www.hmrcisshite.com), also available via the domain www.hmrconline.com, is brought to you by www.kenfrost.com "The Living Brand"

Taxpayers Wrongly Penalised

It seems that up to 20,000 taxpayers have wrongly been fined £100 for late filing, despite submitting their returns on time.

Baker Tilly said it realised HMRC had issued a "large number" of incorrect penalty notices when many of its clients, whose returns were filed before the January 31 deadline for online returns, received notices they would be fined.

Baker Tilly contacted HMRC, and was told by one office that the complaints about incorrect penalties had been "added to the growing pile".

A spokesman for HMRC is quoted in The Telegraph:

"No one who submits a return on time will ever have to pay a penalty. We certainly don't want any payments that we have no right to."

Anyone know why the system issued the penalty notices in the first place?

Tax does have to be taxing.

HMRC Is Shite (www.hmrcisshite.com), also available via the domain www.hmrconline.com, is brought to you by www.kenfrost.com "The Living Brand"

HMRC Chooses RBS

A snippet from the City Diary of yesterday's Times:

"HM Revenue & Customs has had to go looking for another bank. This follows the decision in 2004 by the Bank of England to withdraw from the provision of retail banking and clearing services to government departments and corporate customers in order to concentrate its core responsibilities, HMRC tells me.

(Does anyone know whether this decision led to a more diligent and careful stewardship of the UK economy from Threadneedle Street? Someone remind me.)

So Revenue & Customs had to go through a public procurement process to find the right bank.

The result?

Citigroup and, er, Royal Bank of Scotland.

RBS seems to have been a long way into its present troubles when it was selected for the HMRC job.

Still, life goes on."

Tax does have to be taxing.

HMRC Is Shite (www.hmrcisshite.com), also available via the domain www.hmrconline.com, is brought to you by www.kenfrost.com "The Living Brand"

At The Coal Face

This article, in the March 2009 edition of Oracle, describes a day in the life of an HMRC Contact Centre operative:

Contact Centre

Truly a miserable working environment!

Tax does have to be taxing.

HMRC Is Shite (www.hmrcisshite.com), also available via the domain www.hmrconline.com, is brought to you by www.kenfrost.com "The Living Brand"

Amnesty II

Advice to HMRC: amnesties only work if you publicise them.

In the view of many tax professionals the last amnesty for offshore account holders was not advertised nearly enough.

This time round, with a new amnesty being proposed for offshore account holders, the professionals want a pro active advertising campaign rather than just a posting on the HMRC website.

Tax does have to be taxing.

HMRC Is Shite (www.hmrcisshite.com), also available via the domain www.hmrconline.com, is brought to you by www.kenfrost.com "The Living Brand"

System Problems

I am advised by a tax professional that "due to system problems", attempts to reduce the payments on account of his clients using HMRC's online system (which is used to replace the need to complete a SA303 - Claim to reduce payments on account), have not worked.

The result being that some of his clients have received Self Assessment: Final Demands, and apparently they may receive surcharge notices as well.

To insult to injury, when he phoned his local HMRC office to ask for help they advised him that they couldn't because their internal system had gone down.

The added irony of this story is that it took his clients to advise him of the problem, instead of HMRC.

Tax does have to be taxing.

HMRC Is Shite (www.hmrcisshite.com), also available via the domain www.hmrconline.com, is brought to you by www.kenfrost.com "The Living Brand"

Der Flohzirkus

Gott in himmel!

Oh dear it seems there has been a bit of a cock up with some CD's sent out to employers by HMRC. The Register reports that the February edition of HMRC's "Employer Bulletin" should have contained a CD of software designed to help small firms deal with their tax obligations.

Instead, owing to a foul at the outsourced CD distributor, several hundred CD's (out of a mailshot of 1.5 million) were sent out containing 16 CD audio files of German fairy tales read in German.

The titles ranged from Zwei Ordentliche Kinder (Two Tidy Children), Der Flohzirkus (The Flea Circus) and Gespenster (Ghosts).

Tax does have to be taxing.

HMRC Is Shite (www.hmrcisshite.com), also available via the domain www.hmrconline.com, is brought to you by www.kenfrost.com "The Living Brand"

Shame

This particular comment posted on LabourSpace comes from someone who claims to be an advisor who works for an HMRC contact centre handling tax credit issues, he/she speaks of his/her shame and the fact that the whole system is disgusting.

He/she offers some useful advice to those who need to interact with the contact centres; take the name of the person you are talking to, and do not believe them if they say they can't escalate the problem.

Source LabourSpace:

"I have been an [Tax Credit] advisor for nearly 3 years now. I am the longest serving member of my contact centre by far, the staff turn over is incredible.

I can confidantly say that on most of the calls I get, I notice an error made by a previous advisor. This frustrates me hugely. The errors made for (e.g.) income being changed to nil are basic errors but they are made by inexperienced advisors on an industrial scale.

The contact centres are a shambles.

I count myself as a very good advisor. I have made my mistakes with peoples claims in the past simply through human error but when the person whos claim I have affected calls up and puts in a complaint, I can ensure you these are taken VERY seriously and advisors are severely reprimanded if a complaint is made about them.

Basically what I am trying to say is that a lot of silly errors aren't picked up because people are not complaining about specific advisors. Take their name on EVERY CALL, take their team number and location. I feel like I am betraying my fellow advisors BUT for every good avisor like myself there are 300 brand new ones who literally, through no real fault of their own, get thrown on the phone and given the power to ruin a persons claim, however unintentionally.

Also bear in mind we as advisors have NO power when it comes to escalating issues or chasing up anything done by our head office (TCO). The only option I can suggest if you really aren't getting anywhere is to ask to speak to a manager BUT unfortunately you'd be better speaking to a child, as the managers haven't got a clue and activly avoid taking any escalations.

If an advisor says they can't pass you to a team leader straight away as there are none available do not accept this, because their manager will be sitting opposite them waving their hands in the air, as in a 'I'm not here' manner, to avoid taking a complaint call.

The whole system is disgusting.

I am ashamed to work there but feel like if I left, the few peoples claims I do manage to fix will be lost along with the rest."

Tax does have to be taxing.

HMRC Is Shite (www.hmrcisshite.com), also available via the domain www.hmrconline.com, is brought to you by www.kenfrost.com "The Living Brand"